Month: July 2023

How is Portuguese drug decriminalization going?

by  Tyler Cowen in

Is there fatigue with the experiment?:

Portugal decriminalized all drug use, including marijuana, cocaine and heroin, in an experiment that inspired similar efforts elsewhere, but now police are blaming a spike in the number of people who use drugs for a rise in crime. In one neighborhood, state-issued paraphernalia — powder-blue syringe caps, packets of citric acid for diluting heroin — litters sidewalks outside an elementary school.

Porto’s police have increased patrols to drug-plagued neighborhoods. But given existing laws, there’s only so much they can do. On a recent afternoon, an emaciated man in striped pants sleeping in front of a state-funded drug-use center awoke to a patrol of four officers. He sat up, then defiantly began assembling his crack pipe. Officers walked on, shaking their heads.

Portugal became a model for progressive jurisdictions around the world embracing drug decriminalization, such as the state of Oregon, but now there is talk of fatigue. Police are less motivated to register people who misuse drugs and there are year-long waits for state-funded rehabilitation treatment even as the number of people seeking help has fallen dramatically. The return in force of visible urban drug use, meanwhile, is leading the mayor and others here to ask an explosive question: Is it time to reconsider this country’s globally hailed drug model?

For a while the experiment seemed to be working (see the story), but matters have worsened:

Overdose rates have hit 12-year highs and almost doubled in Lisbon from 2019 to 2023. Sewage samples in Lisbon show cocaine and ketamine detection is now among the highest in Europe, with elevated weekend rates suggesting party-heavy usage. In Porto, the collection of drug-related debris from city streets surged 24 percent between 2021 and 2022, with this year on track to far outpace the last. Crime — including robbery in public spaces — spiked 14 percent from 2021 to 2022, a rise police blame partly on increased drug use.

Here is the full WaPo story.

Central Notions of Smithian Liberalism

by  Tyler Cowen in

Just out, by my colleague Daniel B. Klein, I have not yet read it.  It is described as follows:

Central Notions of Smithian Liberalism explores notions jural, political, and economic. The author does intellectual history as a way of theorizing—that is, to advance political theory, jural theory, moral theory, social theory, economic theory. The author treats Adam Smith and the liberalism he shared with David Hume and Edmund Burke. They represent classical liberalism at its best. Their classical liberalism is today aptly called conservative liberalism. The chapters derive mostly from substantial articles previously published in scholarly journals. Chapters expound Smith’s tri-layered justice, liberty, jural dualism, Humean conventionalist political theory, and Smithian liberalism. A chapter written with Erik Matson, “Convention without Convening,” explains natural convention, transcending “nature” and “convention” and attesting the place of Hume and Smith in natural law traditions and enlarging our understanding of those traditions. A chapter asks and answers, “Is It Just to Pursue Honest Income?”.  Another chapter identifies four sets of nonconflicting rules, namely (1) government law, (2) commutative justice, (3) ethics writ large, and (4) just government law. Other chapters relate Smithian liberalism to various topics, including Iain McGilchrist’s divided brain, being grateful for without being grateful to, and the Export-Import Bank. The final chapter considers the fortunes of liberalism in relation to prevailing attitudes toward allegory and God.

Free download at the link, I am pleased to see more books presented in this fashion.  Much better than the $100 price tags (and up) you get from some publishers…

Wemby

by  Tyler Cowen in

He clearly is a special and multi-faceted talent, but I am worried.  Most of all, I am worried by his body shape, which reminds me of both Pervis Ellison and Shawn Bradley, with a height somewhere in between those two.  Players with that kind of physique typically have problems a) avoiding injuries, and b) avoiding foul trouble (they are not always strong enough to hold their ground, they tend to reach a lot, and they tend to be fooled by fakes).

So can he stay on the court?  I am not picking him to win Rookie of the Year, as some big men take much longer to develop (I am looking more at the five blocks than the 2-13 shooting in his Summer League debut).  Let’s hope he gets the chance.

Regulating Transformative Technologies

by  Tyler Cowen in

That is a very new paper by Daron Acemoglu and MIT grad student Todd Lensman, here is the abstract:

Transformative technologies like generative artificial intelligence promise to accelerate productivity growth across many sectors, but they also present new risks from potential misuse. We develop a multi-sector technology adoption model to study the optimal regulation of transformative technologies when society can learn about these risks over time. Socially optimal adoption is gradual and convex. If social damages are proportional to the productivity gains from the new technology, a higher growth rate leads to slower optimal adoption. Equilibrium adoption is inefficient when firms do not internalize all social damages, and sector-independent regulation is helpful but generally not sufficient to restore optimality.

Maybe that’s not a great abstract for non-economists, but the paper itself is pretty clear if you read through it.  It is very good to see someone finally start working this out.  Basically they lay out which assumptions might be needed to make a case for slowing down the progress of AI.

The case for accelerationism becomes stronger if you consider:

1. Early adoption of a technology, especially if done selectively, may facilitate learning.

2. The existence of a rival nation(s) with “less aligned” values and also with less reliable safety procedures.

3. The risk that a centralized regulator might make the technology more rather than less risky.  For instance, you might push the development of the technology into harder to monitor open source forms, and inefficiently so.

Of course a key goal is to endogenize the risk of serious social damages from AI in a decentralized system, rather than taking that risk as given.  I don’t expect the authors to have done that in this paper, in any case this literature is now up and running.

Friday assorted links

by  Tyler Cowen

1. “But when Seema Ghulam Haider, 27, a married Pakistani Muslim, sneaked into India with her four children to be with Sachin Meena, 22, a Hindu man, their time together was brief.” (NYT)

2. John Coltrane in Italian.

3. “Many people with hoarding tendencies never face intervention.”

4. New Tablet podcast with Walter Russell Mead.

5. Libertarianism as a warning system.

6. “When leaders in the shrinking Alaskan fishing village of Karluk made a plea on social media asking two families with three to four children each to move to the Last Frontier state to save their cherished school, they did not expect thousands of responses to pour in.”

7. Solve for the San Francisco self-driving taxi equilibrium.

Alexey summarizes the advice he hears me give people

by  Tyler Cowen in
  1. You can always do better.
  2. Don’t do a big project if the conversations you have w/ your future colleagues are not the most exciting ones you have.
  3. Prepare to live in times of change.
  4. What great people work on is overdetermined because it’s clear what the greatest thing to do is at any point in history.
  5. Always keep improving your mentors and always keep asking yourself who are the young people you want to be talking to.
  6. Recursive self-improvement requires a closed system.
  7. Find a partner.

How will artificial intelligence affect real interest rates?

by  Tyler Cowen in

In standard models, a big dose of AI boosts productivity, which in turn boosts the return on capital, which then raises real interest rates.

I am less convinced.  For one thing, I believe most of the gains from truly fundamental innovations are not captured by capital.  Was Gutenberg a billionaire?  The more fundamental the innovation, the more the import of the core idea can spread to many things and to many sectors.

Furthermore, over the centuries real rates of return seem to be falling, even though there are some high productivity eras, such as the 1920s, during that time.  The long-run secular trend might overwhelm the temporary productivity blips, I simply do not know.

I do think AI is likely to increase the variance of relative prices.  Observers disagree where the major impacts will be felt, but possibly some prices will fall a great deal — tutoring and medical diagnosis? — and other prices will not.  Furthermore, only some individuals will enjoy those relative price declines, as many may remain skittish about AI for quite a few years, possibly an entire generation.

That heterogeneity and lack of stasis will make it harder to infer real interest rates from observed nominal interest rates.  Converting nominal to real variables is easiest under conditions of relative stasis, but that is exactly what AI is likely to disrupt.  Furthermore, real inflation rates, and thus real interest rates, across different individuals, are likely to increase in their variance.

Overall, that blurring of nominal and real will make the Fed’s job harder.  And it will be harder for Treasury to forecast what will be “forthcoming real interest rates.”

Thursday assorted links

by  Tyler Cowen

1. A critical history of the AI safety movement.

2. Richard Hanania on class-based affirmative action.

3. James J. Lee comment on the new Greg Clark results.

4. Emily Wilson on different Iliad translations, and her new one (NYT).

5. What happened to the global corporate tax rate deal?

6. People who make money running YouTube channels showing how much they lose by playing slot machines (WSJ).

Stephen King on inflation targets

by  Tyler Cowen in

Inflation targets are not supposed to be mere fair weather friends. They serve at all times to reduce arbitrary and undemocratic redistributions of income and wealth and stealthy forms of “hidden” taxation, all of which monarchs, despots, autocrats and, yes, democratically elected governments have, via the printing press, exploited. While there’s nothing wrong with debating the correct target “number”, choosing to raise targets when inflation has persistently surprised on the upside smacks of no more than short-run political opportunism — precisely what central bank independence was supposed to avoid.

There is more, here is the full FT link.

Louisiana federal judge says “hands off”

by  Tyler Cowen

One day after a Louisiana federal judge set limits on the Biden administration’s communications with tech firms, the State Department canceled its regular meeting Wednesday with Facebook officials to discuss 2024 election preparations and hacking threats, according to a person at the company. The move came hours before Biden’s Department of Justice filed a notice that it will appeal the ruling.

Here is the longer story.  It seems unlikely the Louisiana decision will stand, but I would apply some game theory and look at this from a different angle.  Let’s assume the Louisiana judge could prevent the federal government from communicating with the major social media companies.  The social media companies still would have to work very hard to please the federal government, given the seriousness of the regulatory stakes.  In fact, lack of communication could make the social media companies try all that much harder, since they would not know if they were meeting the standards of the federal government.

The actual solution here is not to alter the degree of communication, but rather to have the federal government surrender so many of its arbitrary regulatory powers over American business, most of all with the major tech companies.

*Regime Change*

by  Tyler Cowen

That is the new Patrick J. Deneen book, with the subtitle Toward a Postliberal Future.  I would say that reading and trying to review this book most of all raises the question of what a review is for.  As you might expect from Deneen, the book is well-written and comes across as highly intelligent.  The question is what one should make of the actual claims and content.

The opening chapter tells us what a failure America is, but not much in the way of concrete evidence is cited (what again would an American passport auction for?). Deneen writes “A growing chorus of voices reflects on the likelihood and even desirability of civil war…”, but that I think means he simply faced some publication lags with the book.  America still seems to be gaining on most of the world.

By the end of the next chapter, we are told “Unfortunately, the current ruling class is uniquely ill equipped for reform, having become one of the worst of its kind produced in history…”

C’mon, people…C’mon, Patrick!  I don’t even have to invoke Godwin’s Law to refute that one.  I can think of a few historical elites who were slightly worse than those who go to Harvard and Yale.

The quick segment on Mill on slavery (p.82) is both wrong and deeply unfair.

Burke is closer to Mill than Deneen might wish to think, especially if one studies Burke on Ireland.

The chapter “The Wisdom of the People” is rather under-argued in a post-Bryan Caplan, post-Garett Jones intellectual era.  You don’t have to agree with Caplan or Jones to recognize they offer orders of magnitude more evidence than Deneen does.  One of the bigger lessons here is that you can no longer write such a book without seriously engaging with social science.

All this talk about creating a “mixed constitution,” but what exactly does he want to see happen?  Is “Machiavellian means to achieve Aristotelian ends” really what we need?  (Might some rather mundane changes in policy get us further?)  What exactly are we supposed to do to increase the status, influence, and reputation of the populace, as Deneen repeatedly suggests?  Where is the evidence any of that is going to work, whatever “work” might mean in this context?  This book will not tell you.

National service, tariffs, and immigration restrictions are all endorsed, but with no consideration of the rather extensive empirical literatures on these topics, mostly not supporting Deneen’s hastily presented conclusions.

Is liberalism really (p.229) “premised on the complete liberation of the individual from any limiting claims of an objective good…”?  Mill certainly didn’t think so, nor did most other classical liberals.

I would start by distinguishing the social consequences of birth control — which isn’t going to be reversed and shouldn’t be — with the social consequences of classical liberal ideas.  Is Deneen in fact willing to endorse birth control?  Inquiring minds wish to know.

If Western liberalism is “exhausted,” is he short the market?

Overall, I leave this book with the impression that it is no accident classical liberal ideals have endured as much as they have.